More Matte issues

I have searched and read all kinds of posts on creating a matte from an AE project. In my case it's one of the aAE projects from Digital Juice's Motion Designer Toolkit. I grabbed their project, pulled it into AE and changed it to the length I needed and exported. Then I have done exactly what is listed on this form and in the avid manual:

Background on V1
Foreground on V2
Black image with alpha on V3 then nest the Matte Key effect on top.

The images come through, but everything has a washed out look to it. The alpha looks good until I apply the key effect. It's almost as if the key effect put down an extra white background over everything.

I have tried numerous import settings within avid and export setting withing AE, all with essentially the same results. Help.